By Lena Babaeva 

Good news that the process is moving along—the Senate Finance Committee approved about $31 billion in tax credits and other incentives to boost alternative energy supplies and technology, as part of the economic recovery plans.  The news came late Tuesday, and is a good sign for the alternative energy industry during the time of low oil prices.  

The Senate measures are more helpful to the alternative energy companies than those advanced by the House legislation.  Both the House and the Senate, in considering the difficulty of obtaining financing for renewable energy projects, allow facilities in place in 2009 and 2010 to temporarily claim a 30 percent investment tax credit, instead of a production credit, that is normally paid out over 10 years.  

Other energy tax breaks and financial incentives in the Senate and House bills would:

•  Increase the tax credit for service stations that install pumps that dispense alternative energy fuels like hydrogen, natural gas and gasoline made from 85 percent ethanol.
• Give homeowners a tax credit equal to 30 percent (capped at $1,500) of the amount they paid for energy-efficient furnaces, hot water boilers and other energy savings improvements.
• Authorize $1.6 billion in new clean renewable energy bonds to finance facilities that generate electricity from wind, biomass, geothermal, small irrigation, hydropower, landfill gas, ocean currents and trash burning facilities.
• Allow states to issue $2.4 billion in conservation tax credit bonds to finance loans and grants to individual homeowners to retrofit existing housing.
• Provide individuals with a 30 percent uncapped tax credit for buying solar water heating property, small wind energy property and geothermal heat pumps. 

It will be interesting to see what final tax credit packages pass through both the House and the Senate.